All we are chemical company that sells the intermediate product that we also use in downstream products.
Our issue is capturing the plant and packaging cost we apply to the Finished Good via a production order.
This is bottlenecking our shipping department.
Does anyone have any suggestions on how to accomplish this.
I think your best option is to make a new item that is the packaged version of this intermediate and setup a BOM and route. Then make production orders to consume the intermediate and packaging supplies producing the packaged intermediate. It sounds like you may be trying to avoid having a production order, but a production order seems the best way to capture these costs. You can probably make production order for the day for all of the packaged intermediate that was produced.
Thank you, yes that is how it is currently setup and works great on packaging but not on bulk. The timing of JIT does not help shipping and all the paperwork and additional shipping info. We were brainstorming and thinking we would allow the FG to go negative and then do one production order to cover all the sales and zero out the inventory. Still capturing the cost and allow shipping to move. What do you think about that?
If I can add to Barclay's recommendation, a production order will require to change the item number, so there is one item number for the intermediate product in bulk form, and a second item number for the intermediate product in packaged form. Having separate item numbers will let you plan inventory more effectively. The packaged item will not be considered as available to use when the bulk product is needed for further production, and the bulk product will not be considered as available for shipping to customers.
Unfortunately sell bulk as well as packaged. Would have loved to do BOM movement but we loose costs. :-(
Don't go the route of negative inventory, it sounds nice but its not. This can mostly all be automated so that all you do is process raw material picking work or post a picking list journal against a production order.
------------------------------Colby GallagherManaged Application Services SupervisorRSMOH------------------------------
Hi, if you main issue is just the costing, why can't the plant and packaging costs be Overhead captured against a Costing sheet? If you have route operations taking place at Resources, the cost groups and cost categories on those Resources can define your overhead rate as a % or flat charge to be captured when you make the item.
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